A significant fraud operation linked to Bank Verification Number (BVN) enrolment agents has resulted in the theft of N329 million, sparking worries about vulnerabilities in Nigeria’s financial system.
According to a report obtained by Africa Health Report on Sunday from the Nigeria Inter-Bank Settlement System (NIBSS), fraudsters took advantage of vulnerabilities in the BVN registration process by using static images to create fake identities, which were subsequently linked to fraudulent bank accounts.
The NIBSS report noted that “agents who refuse to comply capture still images of Asians and Nigerians and register them for BVN. These BVNs are then used to open accounts at Microfinance Banks (MFBs), Mobile Money Operators (MMOs), and Payment Service Banks (PSBs).”
Authorities have initiated an investigation into the false enrolments, referring the involved agents to law enforcement for arrest and prosecution. These fraudulent accounts facilitated illicit transactions amounting to N329 million just days after they were created.
In reaction to the scandal, financial regulators are enhancing the monitoring procedures for BVNs. The Central Bank of Nigeria (CBN) has instructed financial institutions to report any fraudulent BVNs to NIBSS within 24 hours of identification to prevent additional misuse.
The report also indicated that fraud losses in Nigeria’s financial sector rose to N52.26 billion in 2024, representing a 350 percent increase from N11.61 billion in 2020. Although the number of reported fraud cases fell by 31 percent during this time, the complexity and scale of the fraud schemes have increased considerably.
The report revealed that an increased number of BVNs created with still images of Asians were initially given Nigerian names, which were discovered during reviews and subsequently removed.
